In a move announced last month to incentivize transportation that causes less pollution, the Banco de Comercio Exterior de Colombia (Bancóldex) said that it will no longer finance public transport vehicles that operate on diesel.

The public development bank, which is based in a capital where buses crisscross the city belching out black smoke, said that its board of directors made this decision to promote transportation alternatives that are more friendly for the environment.

Photo: Bancóldex no longer wants to fund any more of the diesel-guzzling buses that currently flood the streets of Bogotá. (Photo credit: Jared Wade)

Instead, Bancóldex said that it will seek ways to stimulate, through its ability to finance large projects, the adoption of “cleaner energy sources, such as gas and electric power.”

As it looks to expand the Transmilenio rapid bus transit system in Bogotá, the mayor’s office has been fielding proposals based around new-generation buses that are said to contribute less to air quality problems than traditional options.

This includes the second largest Colombian city, Medellín, where air quality issues reached crisis levels earlier this year, and public officials have been working on ways to lower the pollution and particulate levels in the air.

The problem was severe enough that, amid pressure from environmental groups and other stakeholders, state-controlled oil company Ecopetrol cut the sulphur levels in the diesel it was delivering to the city by 40%-50% in March, according to the company.

Just one year earlier, in March 2017, a corporate-sponsored “Green Race” that sought to raise environmental awareness in Medellín was postposed due to a citywide public “red alert” warning issued ” after “air quality reached critical levels,” according to Banco de Bogotá, one of the event’s sponsors.

“We are participating in a cleaner alternative through this decision, which may mean a sacrifice of our financial interests but constitutes a reaffirmation of a policy in line with improving quality of life of our population,” said Mario Suárez, president of Bancóldex, about the bank’s decision to end financing for diesel-guzzling vehicles.

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About the Author

Jared Wade is editor in chief of Finance Colombia. He is a Bogotá-based journalist with 15 years of experience covering topics including business, financial services, Latin America, and sports. Email him at jared.wade(at) financecolombia.com or follow him on Twitter at @Jared_Wade.